Published
13 Mar 2018

Busting leadership myths in an uncertain world

13 Mar 2018

In this turbulent world, many long-held principles of leadership are under strain or no longer apply. But some leaders continue to operate in the same old ways. How can you adapt your leadership approach to be fit for today's climate?

This article is provided to Changeboard by our Future Talent 2018 partners, Heidrick & Struggles. You can see Heidricks' Managing Partner Colin Price in conversation with Aviva's CEO, Mark Wilson, at Changeboard's Future Talent Conference 2018.

 

The term VUCA - volatile, uncertain, complex, and ambiguous - gained currency in the military during the late 1990s to characterise unpredictable, unstable, and asymmetric warfare with agile, dispersed opponents no longer fighting under the rules of traditional military engagement.

Today, VUCA describes the world of business as well, which is posing profound new challenges for leaders who must deal with volatile markets, uncertain economies, global and technological complexities, and ambiguities at every turn.

In this turbulent world, many long-held principles of leadership are under strain or no longer apply. Yet they enjoy a surprising persistence, with companies and leaders clinging to what are by now essentially myths. Here are four of the most persistent - and destructive - of those myths.

Myth 1: Leaders must develop a strategic direction - and stick boldly to it

While all leaders need to set a strategic direction, it must be flexible and adaptable to rapidly changing market conditions.

Sticking to one vision and ignoring signs that it must change is a recipe for disaster. Business history is littered with full-speed-ahead types who resolutely ran their companies aground.

For example, even when it became obvious that the impossibly thin margins on groceries couldn’t support online grocer Webvan’s business model, the company forged ahead, buying HomeGrocer, which was also losing millions of dollars. Bankruptcy soon followed.[1]

According to research reported in the Harvard Business Review, “8 in 10 managers say their companies fail to exit declining businesses or to kill unsuccessful initiatives quickly enough.”[2]

Instead of trying to sustain advantage unreasonably - in a market or region, a product, a line of business, or an acquisition - smart leaders move on before decline sets in.

Myth 2: Leaders need to manage risk and minimise failure

Risk is scary; mistakes are embarrassing. But in today’s world, the winners are likely to be leaders and organisations that learn fast, fail fast, and incorporate the lessons learned into the next experiment.

Consider SurePayroll, which presents an annual “Best New Mistake” award. Each year the payroll-services company awards cash prizes for the failed efforts that led to the most significant learning.[3]

And Engineers Without Borders (EWB), a nongovernmental organization that works worldwide to help disadvantaged communities and people through engineering projects, accelerates learning by posting its mistakes online for all to see, including especially the engineers at EWB organisations in other countries.

Such initiatives send the message that it’s beneficial to pursue innovative ideas.

Myth 3: Leaders need to build consensus

Consensus is in fact often the enemy. A domineering leader can get a team to reach consensus on almost anything, including nonsense. When consensus is reached through compromise, you are likely to wind up with the lowest common denominator among conflicting positions. And consensus seeking can be a painfully slow process.

In a VUCA world, particularly when tackling major strategic decisions, leaders should seek out genuinely diverse views to see multiple sides of complex issues and explore important problems from numerous angles.

A global private-equity firm does this, in part, by using devil’s advocates to research and debate the opposing side of investment decisions to make sure that the company doesn’t fall prey to groupthink.

Myth #4: Leaders must always be confident

In a survey of 150 global CEOs we conducted in partnership with the Saïd Business School at the University of Oxford, we found that more than four in five CEOs say they doubt themselves.[4]

Indeed, forward-looking CEOs not only admit doubt but embrace it as a basis for making better decisions. Before starting new projects, they ask, “If this project dies six months from now, what are we likely to say killed it?”

Brainstorm all the potentially fatal flaws, make the plans more robust, identify early signs of trouble, and develop contingency plans. Such humility isn’t confined to CEOs.

“Fear is my fuel,” director Steven Spielberg told the New York Times. “I get to the brink of not really knowing what to do and that’s when I get my best ideas. Confidence is my enemy and it always has been.”[5]

Agility is key

Taken together, these four leadership myths suggest a counter-truth: In today’s turbulent world, great leaders are, above all, agile. This skill is vital in a business environment where the only real certainty is that certainty itself is in short supply.

A version of this article was originally published in the Heidrick & Struggles Knowledge Centre.

See Heidrick & Struggles at the Changeboard Future Talent Conference

 

About the authors

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Steven Krupp and Roch Parayre are both partners in Heidrick & Struggles’ Philadelphia office and members of the Leadership Consulting Practice.

 

References

[1] Greg Bensinger, “Rebuilding history’s biggest dot-com bust,” Wall Street Journal, January 12, 2015.

[2] Donald Sull, Rebecca Homkes, and Charles Sull, “Why strategy execution unravels—and what to do about it,” Harvard Business Review, March 2015.

[3] Sue Shellenbarger, “Better ideas through failure,” Wall Street Journal, September 27, 2011.

[4] Heidrick & Struggles and Saïd Business School at the University of Oxford, The CEO Report: Embracing the Paradoxes of Leadership and the Power of Doubt, January 21, 2015.

[5] Manohla Dargis, “A word with: Steven Spielberg,” New York Times, May 15, 2016.